What does “keep eSIM and erase data” mean?
When resetting an iPhone, you'll be prompted with an option to “keep eSIM and erase data,” which means that your phone will be able to delete virtually all data stored on the device (like your personal files, photos, apps, and preferred settings) but will not deactivate any of the eSIMs you have installed. Essentially, it’s resetting your phone factory settings but still preserving your eSIM.
If you’ve encountered an issue and you’re troubleshooting, or are doing a clean refresh of your device, this is a useful option. It saves you from the hassle of entirely setting up your cellular service from scratch, or having to reinstall any eSIMs that you might be using for travel, work, or other purposes.